Virtually every professional has learned that generating referrals from clients and prospects is a key to success, yet surveys of thousands of attendees of my referral training seminars indicate that less than 15% of all salespeople and professionals generate enough referrals to impact their business. Traditional referral trainers have taught us to “do a good job and ask for referrals.” Using the traditional approach, the typical professional services business will get an occasional “referral” or two from their clients, but these tend to be just names and phone numbers, rather than qualified prospects. Even worse, this “do a good job and ask for referrals” approach creates five problems:
1. The client is not prepared to give referrals.
By waiting until the service is complete and then asking for referrals, your client has not had an opportunity to prepare for your request. To the client, the request comes from out of the blue. When you approach your client with your request without giving him an opportunity to think about it, you put him on the spot. You are giving him only a few seconds to go through his mental file cabinet.
2. The client does not know what you need.
It may seem obvious to you, but your client has little idea of what makes a good referral for you, even if she takes a few seconds to think about it. You assume that because your practice involves a number of services for small to mid-size businesses, from management consulting, to tax preparation, to financial analysis, your client is immediately going to think, “What other companies do I know or do I do business with that might need Toms’ advice and expertise?” Wrong assumption. What she actually thinks is “what does this person want from me?”
3. Your client does not have a reason to give referrals
We assume that if we have done a good job, the client will like and respect us and be willing to give us referrals. Again, this is far from the case. Most clients will not give quality referrals just because they like you or because you have done a good job for them. They need a reason to give you referrals. They need to understand why it is in their best interest to give you referrals.
Clients assume that whomever they refer you to will be more demanding and critical they have been. When a client gives a referral, he is putting his reputation and image on the line with the person to whom he is referring to you. He is concerned about what his friend or acquaintance is going to think of his and his judgment, particularly if you mess up.
4. The client doesn’t have an objective standard by which to measure your performance.
The traditional referral generation method does not give the client an objective standard by which to measure the quality of your performance. You and your client may “feel” you have done a good job, but when you ask for referrals, they begin to think back over the process more critically and question whether you have really performed up to standards they believe others would find acceptable.
If the two of you agree up-front on exactly what you need to do in order to “do a good job,” the client will have an objective basis to decide if she trusts you enough and if you have performed well enough to earn the right to be sent to people she really knows well and respects.
5. Most advisors do not ask for referrals
Finally, from tracking the responses of the attendees of my seminars, it appears a majority of professionals do not ask for referrals–rather they suggest them. Instead of asking a direct question seeking referrals such as, “John, what other business owners do you know that I may be able help solve some crucial issues?” the typical professional will make a weak suggestion such as, “John, if you happen to know someone I can help would you mind letting me know?” Or, “John, if you run across someone, who could use my services, would mind giving them my card?” Rather than a request for referrals, these are throwaway sentences, quickly forgotten by most clients.
Traditional referral training is inherently unfair to you and your client. It does not give you the tools needed to successfully work with your client to generate quality referrals, and it gives your client neither a reason to give referrals, nor a chance to become comfortable referring you to people they know and respect.
Generate the referrals you want
Yet, it is possible to generate a very large number of high quality referrals from your clients. You need to have a referral generation process that:
- Informs your client ahead of time that you will ask for referrals
- Lets the client know what your definition of a referral
- Educates your client on why providing referrals is in their best interests
- Provides an agreed upon objective criteria to determine your performance
By forming a process where you eliminate the problems associated with the traditional referral generating method, you will increase not only the number of referrals you receive from your clients, but also the quality of each referral.
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